10 Tips to Help You Get Out of Debt
Debt is overwhelming and may seem impossible to pay off, but Launch CU has you covered! Use these 10 tips to help you get out of debt. If you find that you are continuing to collect debt and have no idea how to pay it all off, developing a step-by-step strategy is your first task. At Launch CU, we care about your financial well-being. That is why we created this guide to help you pay off your lingering debt so you can go beyond and reach your financial goals.
Key Points
- Create a budget and stick to it to manage spending and prioritize debt repayment.
- Pay off high-interest debt first and consider balance transfers or consolidation to save on interest.
- Make more than minimum payments and consider frequent payments to accelerate debt payoff.
- Use extra funds, like tax refunds or bonuses, and take advantage of available resources to stay on track and improve financial health.
1. Create a Budget and Stick to It
Create a monthly budget that covers all of your expenses. You can easily track your spending using an Excel spreadsheet or budgeting apps like Quicken. One of the most challenging things to do when sticking to a budget is distinguishing between needs and wants. This might mean putting off that impulse purchase until later.
2. Balance Transfers Can Be Extremely Helpful
If you’re paying a high interest rate on your credit card, think about switching to a credit card with a lower interest rate. Apply for a credit card with Launch CU! Our credit cards have no annual fee* and no balance transfer fee*. If you’re not sure what your interest rate is on your credit card, make sure to check on your next statement. You may be surprised by how much you are paying in interest.
3. Think About Consolidating Your Debt
Consolidating your debt could help you pay less interest and could help to get you out of debt faster. When you consolidate your loans with Launch, you get low rates, simple interest, no application fee, and no prepayment penalties.
4. Pay Off Your Most Expensive Debt First
If a balance transfer is not the best option for you, pay off your credit card with the highest interest rate first. Paying off debt is just like anything else in life. The hardest tasks are always the most painful, but once they have been tackled it’s smooth sailing.
5. Consider Paying More Than the Minimum Balance
To make a dent in your debt, you will need to pay more than the minimum balance on your statement each month. According to US News, paying the minimum balance takes only 2-3% off your outstanding balance and only prolongs your debt payoff.
6. Think About Making More Frequent Payments
When setting up your budget, try to set up weekly or bi-weekly payments instead of monthly payments. Doing this will help you pay your debt off faster. If you are not able to pay your bill weekly or bi-weekly, consider paying 1.5 to 2 times your minimum payment on your monthly statement to accelerate your progress.
7. Stop Buying Items on Credit Until You Have Your Finances Under Control
If you run to the store, think about stopping at an ATM beforehand to get cash and leave your credit card at home, or bring your ATM/Debit card to the store for purchases. Remember, one of the many perks of being a Launch CU member is the ability to use your Launch CU ATM/Debit Card at any Launch CU branch ATM and any Publix Presto ATM machine free of charge.
8. Put Your Tax Refund or Holiday Bonus Toward Your Debt
We know it’s tempting to spend your tax refund or holiday bonus on personal items, but putting this money towards your debt will pay off in the long run. Prioritizing your financial well-being is much more valuable than splurging on that new flat-screen TV!
9. Use Some of Our Tools and Resources
As a valued member of Launch CU, your financial health is our priority, so we’ve partnered with the trusted national nonprofit GreenPath Financial Wellness to offer you free financial counseling, guidance, and educational resources.
10. Above All, Never Hesitate to Contact Us
Give us a call at 321-455-9400 (inside Brevard) or 800-662-5257 (outside Brevard) if you have any questions about your debt. Remember, you are not alone. We are dedicated to helping you find a way to improve your financial well-being.
FAQs
How do I know if I have “too much” debt?
If you’re struggling to make payments, relying on credit to cover everyday expenses, or feeling stressed about money most of the time, your debt may be impacting your financial health. A financial check-in or counseling session can help you understand whether your debt level is manageable and what steps to take next.
What’s the difference between “good” debt and “bad” debt?
Not all debt is created equal. Debt used to build long-term value—like education or a home—may be considered “good” debt, while high-interest consumer debt that doesn’t add lasting value can slow your financial progress.
Will paying off debt improve my credit score?
In many cases, yes. Reducing balances, making on-time payments, and lowering your credit utilization can all have a positive impact on your credit over time.
Is it possible to pay off debt while still saving money?
In many cases, yes. Even small contributions to savings can help prevent future reliance on credit and keep you moving forward financially.
